Download Change of Control Amendment/Termination New Plan Benefits

Item 4—Approval of the Prudential Financial, Inc. 2016 Omnibus Incentive Plan
Change of Control
Upon the occurrence of a change of control of the Company, outstanding Awards will generally be treated as follows, regardless
of the Award’s otherwise applicable terms:
• No acceleration of vesting or exercisability, cancellation, cash payment or other settlement will occur with respect to any
outstanding Awards if the Committee reasonably determines in good faith prior to the change of control that the Awards will
be honored or assumed or equitable replacement awards will be made by a successor employer immediately following the
change of control, and that such replacement awards will vest and payments will be made if a participant is involuntarily
terminated without cause.
• If the Committee reasonably determines in good faith that Awards will not be honored or assumed and equitable
replacement awards will not be made by a successor employer immediately following the change of control, then (i) any
Option and SAR will become fully exercisable, (ii) the restrictions for each share of Restricted Stock and each Restricted Unit
will lapse and (iii) any Performance Share or Unit (that is not converted as described below) will be considered to have
vested at target levels. The Committee may, in its discretion, provide for cancellation of each Award in exchange for a cash
payment per share based upon the change of control price.
• Unless the Committee otherwise determines, prior to a change of control, Performance Shares and Units for which 50% of
the performance period has elapsed and for which the Committee determines that performance is reasonably capable of
being assessed will be converted into Restricted Units based on performance until the date of the change of control.
Performance Shares and Units for which less than 50% of the performance period has elapsed or for which performance is
not reasonably capable of being assessed will be converted into Restricted Units based on the assumption that the Awards
will be earned at target.
For purposes of the 2016 Omnibus Plan, “change of control” means: (i) the acquisition, directly or indirectly, of Company
securities representing at least 25% of the combined voting power of the outstanding securities of the Company by any “person”
(within the meaning of Section 3(a)(9) of the Exchange Act); (ii) within any 24-month period, a change in the majority of the
Board in existence at the beginning of such period; or (iii) the consummation of certain mergers, consolidations, recapitalizations
or reorganizations, share exchanges, divisions, sales, plans of complete liquidation or dissolution, or other dispositions of all or
substantially all of the Company’s assets, which have been approved by shareholders, if the Company’s shareholders do not hold
a majority of the voting power of the surviving, resulting or acquiring corporation immediately thereafter.
Amendment/Termination
The Board of Directors may, at any time amend, modify, suspend or terminate the 2016 Omnibus Plan, in whole or in part,
without notice to or the consent of any participant or employee; provided, however, that any amendment which would (i) increase
the number of shares available for issuance under the 2016 Omnibus Plan, (ii) lower the minimum exercise price at which an
Option (or the base price at which a SAR may be granted) or take any other action that would be prohibited under the 2016
Omnibus Plan that would have the effect of lowering the exercise price (or base price), or (iii) change the individual Award limits
shall be subject to shareholder approval. No amendment, modification or termination of the 2016 Omnibus Plan may in any
manner adversely affect any previously granted Award, without the consent of the participant.
New Plan Benefits; Market Value of Securities
Awards under the 2016 Omnibus Plan are based on the discretion of the Committee and/or the Company’s achievement of
performance targets, and it is not currently possible to determine the amounts of future Awards. Accordingly, it is not possible to
determine the amounts that will be received by employees participating in the 2016 Omnibus Plan in the future. As of March 11,
2016, the closing price of our common stock was $73.55 per share.
U.S. Federal Income Tax Implications
The following is a brief summary of the U.S. federal income tax consequences applicable to certain Awards granted under the
2016 Omnibus Plan, based upon the federal income tax laws in effect on the date of this Proxy Statement. This summary is not
intended to be exhaustive, and the exact tax consequences may vary depending on each participant’s particular situation.
Options and SARs. A recipient of an Option or SAR will not have taxable income upon the grant of the Option or SAR. Upon the
exercise of a Nonstatutory Option or SAR, a participant generally will recognize compensation taxable as ordinary income in an
Notice of Annual Meeting of Shareholders and 2016 Proxy Statement |
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